purpose of analysis - Big Picture Huntsville

Transcription

Huntsville: The Big Picture
Economic Base Analysis
purpose of analysis
This snapshot has been prepared to review components integral to the City of Huntsville’s
economy. A diverse group of indicators were collected and analyzed in order to gain an accurate picture of the health of the local economic base for the City.
While understanding the quantitative components of the City’s economic dynamics is important, it is also valuable to note that the business climate and the actions of the local government are inextricably linked. It is crucial not to forget that qualitative issues do translate into
hard dollar cost items for all segments of a community -- businesses, residents, government
-- as well.
Key economic factors have been reviewed for the City of Huntsville, and compared to the
nation where appropriate, through four sections in this document.
Workers:
Information on labor force and employee characteristics, commuting patterns,
educational attainment, and age distribution is provided.
Jobs:
Characteristics on current employment, employment trends, industry sectors, occupa-
tions, employers, and business size are profiled.
Money:
Data related to income [sources, household, poverty] and earnings [by jobs and
sectors] is reviewed.
Major Findings:
Summary of trends and issues for the City of Huntsville.
The data analyzed in this document is from a variety of sources, including: US Census Bureau,
US Bureau of Labor Statistics, US Bureau of Economic Analysis, Claritas, and City of Huntsville.
June 2014
Page 1
workers
Labor Force1 & Employees
The City of Huntsville’s resident labor force totals approximately 118,100, equaling about
63% of the City’s total population. The labor force accounted for 64% of the Huntsville
MSA’s population. By comparison, the nation’s labor force accounted for 62% of its total
population. These proportions are essentially on par with each other, demonstrating
Huntsville’s population age range constitutes a solid local workforce for a community of
Huntsville’s size.
However, as is common in this day and age, people who live in Huntsville do not necessarily work in Huntsville. There is no question that the City of Huntsville is the job center
of the region, so many non-resident workers commute into the City every day. There are
approximately 178,900 employees in the City of Huntsville.2
There are approximately 70,000 people that both live and work in the City of Huntsville.
For residents, approximately 60% of residents work inside the City and 40% of residents
work outside the City. For workers, approximately 40% of workers live inside the City
and 60% live outside the City.
Commuting Patterns
Residents’ Commutes
As in many communities across the nation, the vast majority (85%) of Huntsville residents
drive alone to work. Approximately three percent of Huntsville residents worked from
Labor force is defined here as all persons between 18 and 65 years of age that live in the jurisdiction. This effectively
excludes the elderly and children. However, these parameters should be considered conservative, as many more retirees
are remaining active in the workforce.
1
2
Source: City of Huntsville, Claritas, Market + Main, Inc.
June 2014
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home. Not surprisingly, very few took public transportation or cycled or walked to work,
but seven percent did carpool.
Most City of Huntsville residents had commute times of 30 minutes or less. A solid proportion (36%) commute less than 15 minutes, and nearly half (48%) commute between 15 and
30 minutes. About 12% of residents had commute times between 30 and 45 minutes; only
four percent have commute times longer than 45 minutes. The average commute time is
20.1 minutes for residents of Huntsville, which is lower than the national average of 27.9
minutes.
Workers’ Commutes
For residents that both live and work in Huntsville, most commutes (69%) are a distance
of 10 miles or less. For workers that live outside of Huntsville, nearly half (47%) commute
less than 10 miles and approximately 28% commute between 10 and 24 miles. There is
also a notable proportion (14%) that commute a distance of greater than 50 miles. About
half of workers that live outside of the City of Huntsville commute from nearby cities
located in Madison and Limestone counties; the other half are in smaller towns and areas
mostly located in Alabama. As mentioned previously, most residents work within the City,
for those that work outside the City, approximately 15% work in nearby cities or areas of
Madison or Limestone counties. Another 15% of residents work in distant locations, which
represent workers that likely telecommute or travel to clients or corporate headquarters.
June 2014
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Educational Attainment
The City of Huntsville has a highly educated resident population as compared to the
nation. Huntsville has fewer residents with less than a high school education and more
with a college education. Approximately 11% of Huntsville residents have less than a high
school level of education, with only three percent having less than a ninth grade education. Nationally, 14% have less than a high school education, with six percent having less
than a ninth grade education.
Those with some college but no degree account for 24% of the population in Huntsville.
For the U.S. as a whole, the figure is 21%. Those with some type of college degree -Associates through Doctorate -- make up approximately 44% of Huntsville’s population,
but only 36% of the nation’s; Huntsville’s proportion of college graduates is higher than
the national average.
In terms of workers, Huntsville’s educational attainment is quite high. Approximately 54%
of Huntsville’s workers have a Bachelor’s or more advanced college degree. About 13%
of Huntsville’s workers have a high school diploma with no college; while about 17% have
some college education or an Associate’s degree. Slightly less than 4% of Huntsville’s
workforce has less than a high school education. 3
Age Distribution
The City of Huntsville is essentially on par with the national average (38.5 years), with an
average age of 39.2 years in the City. The proportion of residents under age 18 (21%)
3
For the remaining 13% of workers, educational attainment data is not available.
June 2014
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is slightly lower than the national proportion (23%). The other contributing factor for a
moderately aged population is the proportion of older folks, with 16% of Huntsville’s residents aged over 65 years, which is slightly higher than the national average (14%).
In terms of workforce, the bulk of Huntsville’s workers (59%) are between 30 and 54 years
of age. About 24% of workers are aged less than 29 years and 18% of people that work
in Huntsville are aged 55 years or older.
June 2014
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jobs
Total Employment
The total daytime population, or employees, for Huntsville is approximately 178,900. 4
Employment in Huntsville has grown steadily and significantly over the last decade.
Historical data on employment is available from different sourcing that, unfortunately, has
a lag time due to reporting guidelines. It is valuable to consider what has been happening in the City over the last several years, even with the gap in timeline from current year.
Jobs grew steadily between 2002 and 2008 in Huntsville, with a total growth of approximately 18%. The chart below demonstrates year-over-year change to show annual
fluctuations, reflecting mostly stable incremental increases.
Annual Change in Total Jobs, City of Huntsville, 2002-‐2011 7.0% 6.0% 5.7% 5.0% 4.0% 3.5% 3.0% 2.5% 2.0% 1.9% 1.7% 1.4% 1.0% 0.0% 0.0% 2002-‐2003 2003-‐2004 2004-‐2005 2005-‐2006 2006-‐2007 2007-‐2008 2008-‐2009 2009-‐2010 2010-‐2011 -‐1.0% -‐1.6% -‐1.4% -‐2.0% Source: LEHD 4
Source: City of Huntsville, Claritas, Market + Main, Inc.
June 2014
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There have been slight losses between 2008 and 2011, an approximately three percent
decline, but at significantly lower rates than the rest of the country.
Sector Employment
Local Sector Employment
While overall employment numbers are an important economic and social indicator, the
types and nature of jobs vary greatly between different regions, and also within regional
economies. The following chart gives a breakdown of employment by category within the
City of Huntsville.
Sector Employment Distribu3on, City of Huntsville, 2014 6.0% Public Administra2on 4.0% Other Services (excluding Public Administra2on) 9.0% Accommoda2on and Food Services 1.5% Arts, Entertainment, and Recrea2on 12.0% Health Care and Social Assistance 4.0% Educa2onal Services 6.0% Administra2on & Support, Waste Management and Remedia2on Management of Companies and Enterprises 0.1% 18.0% Professional, Scien2fic, and Technical Services 2.0% Real Estate and Rental and Leasing 2.5% Finance and Insurance Informa2on 1.5% Transporta2on and Warehousing 1.5% 13.0% Retail Trade 4.0% Wholesale Trade 12.5% Manufacturing 3.0% Construc2on 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% Sources: Claritas, LEHD, BLS, Market + Main, Inc. June 2014
Page 7
The largest proportion of jobs is in the Professional, Scientific, and Technical Services
sector (18%). The next-largest job sectors are Retail Trade (13%) and Manufacturing
(13%). The Health Care and Social Assistance sector accounts for 12% of total employment. Together, these sectors comprise approximately 55% of all jobs in the City. 5
Professional Services, Manufacturing, and Health Care Services are generally higherpaying, higher-skill jobs, while Retail Trade are generally lower-paying, lower-skill jobs.
In the City of Huntsville, Professional Services are comprised mostly of engineering and
computer systems design jobs. The Manufacturing sector’s details are not available (suppressed due to the large proportion of government-related work) but it is identifiable that
this sector is dominated by value-added jobs. Health Care Services are mostly ambulatory and hospital jobs in the City. 5
In addition to the four largest employment sectors, there are three sectors that each
provide between five and ten percent of jobs, and 10 other sectors provide less than five
percent of jobs each. However, given how the statistics are reported, there are eight sectors delineated that, taken together, really make up a “super sector” of Services. When
taking these eight sectors together, it points to Services essentially functioning as the largest employment type, with about 57% of the jobs in Huntsville.
Services historically has been a “mixed bag” when it comes to jobs, including restaurant
workers to doctors to garbage collectors to teachers to amusement park operators. These
sub-sectors are now delineated individually in most data sources as stand-alone sectors to
gain a better understanding of a local economy’s working parts, as demonstrated in the
preceding chart.
Sector Employment Comparison
Location quotients 6 demonstrate concentrations in the local economic base in comparison
to the nation as a whole, as depicted in the chart on the next page. Huntsville has significantly higher proportions of employment in three employment sectors: Professional,
Science, and Technical Services; Administrative and Support Services; and Manufacturing.
There are four employment sectors that are essentially on par with the national proportions of employment: Food Services & Accommodations; Retail Trade; Public
Administration; and Wholesale Trade. The remaining 10 sectors are all below the national proportions of employment.
5
Source: US Bureau of Labor Statistics
Location quotients compare the local employment contribution of any given sector to its contribution nationally. A location
quotient of 1.0 indicates that sector is providing the same percentage of employment locally and nationally. Above or
below 1.0 means the industry is larger or smaller than the national average, respectively.
6
June 2014
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Employment Loca.on Quo.ents, City of Huntsville, 2014 0.94 Public Administra0on 0.71 Other Services (excluding Public Administra0on) 1.03 Accommoda0on and Food Services 0.70 Arts, Entertainment, and Recrea0on 0.77 Health Care and Social Assistance 0.51 Educa0onal Services 1.95 Administra0on & Support, Waste Management and Remedia0on 0.59 Management of Companies and Enterprises 2.70 Professional, Scien0fic, and Technical Services 0.74 Real Estate and Rental and Leasing 0.56 Finance and Insurance 0.64 Informa0on 0.57 Transporta0on and Warehousing 0.98 Retail Trade 0.92 Wholesale Trade 1.50 Manufacturing 0.60 Construc0on 0.00 0.50 1.00 1.50 2.00 2.50 3.00 Source: Claritas, LEHD, BLS, Market + Main, Inc. The Educational Services sector, Finance and Insurance sector, Transportation and
Warehousing sector, and Management of Companies and Enterprises sector are underrepresented when compared to the nation.
Sector Employment Trends
The following chart illustrates the sector employment trends in the City of Huntsville
June 2014
Page 9
between 2007 and 2011. Over the years considered, most of the sectors have remained
relatively stable in terms of proportion in the local economy.
The largest gains were in the Agriculture (202%) and Management (44%) sectors. The
Agriculture employment increases were primarily due to annexation, but the Management
of Companies increase is due to the increase in firms and jobs that manage other companies. The other sectors with double-digit gains during this five-year period were:
Information (17%), Health Care Services (14%), and Wholesale Trade (13%); all generally
high-paying sectors.
Sector Employment, City of Huntsville, 2007-‐2011 100.0% Public AdministraBon Other Services (excluding Public AdministraBon) AccommodaBon and Food Services 80.0% Arts, Entertainment, and RecreaBon Health Care and Social Assistance EducaBonal Services 60.0% AdministraBon & Support, Waste Management and RemediaBon Management of Companies and Enterprises Professional, ScienBfic, and Technical Services Real Estate and Rental and Leasing 40.0% Finance and Insurance InformaBon TransportaBon and Warehousing 20.0% Retail Trade Wholesale Trade Manufacturing ConstrucBon 0.0% UBliBes Mining, Quarrying, and Oil and Gas ExtracBon 2007 2008 2009 2010 2011 Source: LEHD June 2014
Agriculture, Forestry, Fishing and HunBng Page 10
Between 2007 and 2011, the following sectors declined by double-digits, in terms of proportionate share of employment: Manufacturing (-27%); Construction (-21%); Finance &
Insurance (-16%); and Mining/Quarry (-16%).
Occupations
The largest occupational categories for workers in the City of Huntsville are:
• Office and Administrative Support (14%);
• Sales and Sales Related (12%); and
• Management (9%).
Only a few other occupations constitute more than five percent of total employment each,
including: Food Preparation/Serving; Production; Transportation/Moving; and Health
Practitioner/Technician.
Largest Employers
The largest employers in Huntsville/Madison County are listed below.
Employer
Jobs
U.S. Army/Redstone Arsenal
31,500
Huntsville Hospital System
7,129
NASA/Marshall Space Flight Center
6,000
Huntsville City Schools
3,079
The Boeing Company
2,600
Madison County Schools
2,389
SAIC
2,229
City of Huntsville
2,206
June 2014
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Employer
Jobs
ADTRAN, Inc.
1,740
UAHuntsville
1,675
CINRAM, Inc.
1,450
Sanmina-SCI Corporation
1,365
Qualitest
1,350
Intergraph Corporation
1,325
Madison County Commission
1,242
Northrop Grumman Corporation
1,238
Verizon Wireless
1,200
Wyle CAS Group
1,156
Lockheed Martin Corporation
1,150
Toyota Motor Manufacturing Alabama,
Inc.
1,150
Madison City Schools
976
Teledyne Brown Engineering
900
DirecTV
858
Science & Engineering Services, LLC
825
Crestwood Medical Center
822
Yulista Management Services, Inc.
800
Source: Chamber of Commerce of Huntsville/Madison County, July 2013.
June 2014
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Business Size7
Businesses by Employee Size
The bulk of Madison County’s employers are small businesses. Approximately 69% of
area businesses employ fewer than 10 people, with approximately 49% of those businesses employing fewer than five people. Further, for the most part, as number of employees/
size of business increases, the total number of businesses decreases. This can clearly be
seen graphically in the chart below.
Businesses by Size, Madison County, 2011 49.3% 50.0% 45.0% 40.0% 35.0% 30.0% 25.0% 20.0% 20.0% 14.2% 15.0% 10.2% 10.0% 3.2% 5.0% 2.3% 0.5% 0.4% 250-‐499 employees 500 or more employees 0.0% 1-‐4 employees 5-‐9 employees 10-‐19 employees 20-‐49 employees 50-‐99 employees 100-‐249 employees Source: US Census Bureau, CBP There is a limitation to data accessibility in relation to business size, which is only available at the county level or higher,
no geographies smaller in size are available. This data source also has a lag in timing of data reporting and assembly.
7
June 2014
Page 13
Approximately six percent of area businesses employ more than 50 people; of which, approximately three percent of Madison County’s businesses employ more than 100 people.
Businesses by Size & Sector
The major sectors for Madison County’s small businesses (less than 10 employees) are
shown in the chart below.
7% Major Sectors for Small Businesses Madison County, 2011 17% Professional, scien2fic, and technical services 11% Retail trade Other services (except public administra2on) Health care and social assistance Construc2on 11% 16% Source: CBP June 2014
Page 14
The major sectors for Madison County’s large businesses (more than 50 employees) are
shown in the chart below.
11% 23% 12% Major Sectors for Large Businesses Madison County, 2011 Professional, scien3fic, and technical services Retail trade Accommoda3on and food services Manufacturing Health care and social assistance 12% 14% Source: CBP In Madison County, small and large businesses share three major employment sectors in
common: Professional, Science, and Technical Services; Retail Trade; and Health Care
Services. The Other Services and Construction sectors are the other major employment
sectors for small businesses, while the Food Services and Manufacturing sectors are the
others for large businesses.
June 2014
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money
Income
Household Income
Household income levels represent all the sources of income for residents of Huntsville, not
workers. The average household income in the City of Huntsville is on par with the national average. Huntsville’s average household income is approximately $71,000 annually;
this is 99.6% of the national average. Huntsville’s average is much higher than the State
of Alabama average household income of $58,620, which is only 82% of the national
average.
Household Income, City of Huntsville, 2014 15.6% 16.0% 14.3% 14.0% 13.4% 13.1% 12.0% 10.7% 9.9% 10.0% 8.2% 8.0% 6.0% 4.9% 5.2% 4.1% 4.0% 2.0% 0.7% 0.0% Under $15,000 $15,000 -‐ $25,000 -‐ $35,000 -‐ $50,000 -‐ $75,000 -‐ $100,000 -‐ $125,000 -‐ $150,000 -‐ $200,000 -‐ Over $24,999 $34,999 $49,999 $74,999 $99,999 $124,999 $149,999 $199,999 $499,999 $500,000 Source: Claritas June 2014
Page 16
Approximately 23% of Huntsville households have incomes at or above $100,000, as
shown in preceding chart. Another 26% have incomes between $50,000 and $100,000.
Approximately 27% of Huntsville households have incomes less than $25,000.
Sources of Income8
Earnings provide the most significant proportion of income for households in Huntsville
(78%). Approximately 28% of Huntsville households receive Social Security at some level
and another 22% receive other retirement income sort. About 13% of households in the
City receive some sort of public assistance.
Poverty Levels9
The level of poverty for City of Huntsville’s residents is slightly higher than the national
average (11%), but lower than the Alabama average (15%). Families at or below the
poverty level account for approximately 13% of all households in the City.
Earnings
Earnings by Jobs
Earnings represent the job-related income for workers in Huntsville, not residents. The
detail available for worker-related data is limited. It also suffers from lag time due to reporting guidelines, but it is still worthwhile to examine. In the City of Huntsville, the highearnings category ($40,000 or more) is the largest proportion (43%). The mid-earnings
level ($15,001 to $39,999) accounts for 34% and the low-earnings level ($15,000 or less)
is the smallest proportion, at 23%.
8
Source: US Census Bureau
9
The poverty rate for a family of four in 2014 is defined at an income of $23,850 annually.
June 2014
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Jobs by Earnings, City of Huntsville, 2002-‐2011 100.0% 90.0% 80.0% 70.0% $40,000 or more 60.0% $15,001 to $39,999 $15,000 or less 50.0% 40.0% 30.0% 20.0% 10.0% Between 2007 and 2011, jobs that paid less than $40,000 declined by0.0% 15%, while jobs
that pay over $40,000 increased by eight percent during the same timeframe.
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Source: LEHD
Earnings by Sector
While the average earnings for an area can convey a great deal about overall economic
health, sector earnings provide a better sense of the inner workings of the local economy.
June 2014
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The highest paying and lowest paying sectors for Madison County are shown in the following table.
Earnings by S ector, M adison County, 2012
Avg
Annual
Earnings
Lowest-Paying
Sectors
Prof, Science & Tech
Services
$86,200
Retail Trade
$25,900
Management of Co’s
$81,000
Arts, Entertain
& Rec
$17,300
Manufacturing
$63,500
Food Services
& Accomm
$14,800
Finance & Insurance
$61,300
Highest-Paying
Sectors
Avg
Annual
Earnings
There is no question that the Redstone Arsenal is a primary driver of the greater Huntsville
economy, through both direct employment and government contracts. However, it might
be unexpected the depth of the impact on earnings across multiple employment sectors
that are not a direct link to Redstone. The table below shows the difference in earnings
when including federal government-related jobs compared to considering private sector
or local government only for Madison County.
Federal G overnment I mpact on Earnings, M adison County, 2012
Sector
Increase
Admin & Support Services
62%
Public Administration
44%
June 2014
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Sector
Increase
Educational Services
35%
Transportation & Utilities
24%
Arts, Entertain., and Rec.
23%
Retail Trade
19%
Food Services & Accommodations
15%
Finance & Insurance
5%
The impact on earnings is notable enough that the average for individual sector earnings
change slightly when including or excluding federal government jobs. The two lists that
follow show which employment sectors have earnings above the national average, when
including federal government jobs and when excluding.
Including Federal Government:
Excluding Federal Government:
1.
Admin & Support Svcs
1. Health Care Services
2.
Public Administration
2.Manufacturing
3.
Retail Trade
3. Prof, Science & Tech Services
4.Manufacturing
5.
Health Care Services
As seen in the lists above, there are two sectors that have earnings higher than the national average with or without federal government jobs: Health Care Services and
Manufacturing.
June 2014
Page 20
major findings
As with any community, the results and conclusions of this Economic Base Analysis are mixed
for the City of Huntsville. Since community capacity and business climate are really the accumulated sum of numerous individual factors, any individual shortcomings can result in a
negative perception of the community. Conversely, strengths and assets can be leveraged to
establish a positive reality, and thus, project a more positive image of the community.
POSITIVE
NEGATIVE
Anchor of regional economy
Only 40% of workers live inside City
Steady growth in jobs
Small job loss during Recession
Strong proportion of jobs in higher-paying,
Two of largest sectors in lower-paying, lower-
higher skill jobs
skill jobs
Majority of small-sized employers
Small-sized businesses not growing as fast as
national rate
Resident average household income on par
Resident households of families at or below
with national average
poverty level is above national average
Impressive growth in higher-paying jobs
Loss of mid- and lower-paying jobs
Federal government impact on sector em-
Federal government impact on sector em-
ployment & wages is positive
ployment & wages is deep
Overall, the City of Huntsville has strong positives in relation to workforce, types of jobs,
and business size. However, there are notable negatives in relation to economic base
June 2014
Page 21
diversification and residents both living and working in City.
The decision before Huntsville now in terms of economic base viability and vitality is essentially about the type of community that is desired. Huntsville is likely to remain the economic
engine of the greater region, particularly with Redstone Arsenal as an incredible and unique
driver and asset. However, there are some early indicators in the statistics reviewed here that
the City of Huntsville is perhaps not capturing and leveraging its assets to the full benefits of
all residents, and is supporting many more in the surrounding region. While this is a natural
dynamic for the center of any regional economy, the goal would be to ensure that the City of
Huntsville is capturing as much economic impact locally as feasible.
Huntsville can purposefully move towards a more diversified local economy enabling people
to both live and work in the City. This would need to be pursued through sector diversification,
job type/wage diversification, and the expansion and enhancement of locational amenities.
Huntsville has been and is performing relatively well in today’s economy, but positioning for
tomorrow’s economy in this global environment is truly the next step for City leadership for
meaningful community and economic development.
June 2014
Page 22

purpose of analysis - Big Picture Huntsville

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